Representatives from New Zealand's deer industry are travelling to South Korea this month in a bid to boost velvet sales.
Velvet is used in health products like herbal supplements and teas in South Korea. Photo: 123rf.com
South Korea is New Zealand's biggest market for the product, consuming over half of what is produced, but exporters have to compete with well-established Russian products.
The markets manager at Deer Industry New Zealand (DINZ), Rhys Griffiths, said Russian exporters have an established stronghold in velvet imports into South Korea, where velvet is used in health products like herbal supplements and teas.
"When we look at the traditional medicine market where the Russians have historically dominated, if we kind of segment that out even further, we can look at the older Oriental medicine doctors and the older patients, they're more attuned to Russian velvet," he said.
"We actually did a survey of younger Oriental medicine doctors coming through, and New Zealand really has a greater presence in that market.
"So there's no doubt that we're lifting our brand awareness, or if we think of velvet being an ingredient brand, we're lifting the New Zealand brand awareness in that younger Oriental medicine sector, which is kind of where we want to be."
Griffiths and DINZ's chief executive Innes Moffat will travel to South Korea later this month.
Griffiths said it would be Moffat's first trip to the country as the group's chief executive, where he would meet the industry's Korean contacts in person and get more of an understanding of the current market.
He said eight out of 12 new health food products launched in South Korea over the last six months contained, or were marketed to contain, New Zealand velvet, but he has noticed Russian suppliers have upped the ante in advertising to try and increase their market share.
Griffiths said competing with Russian products was difficult, but there was still huge growth potential for New Zealand velvet in South Korea.
"If we look at the sales or the channels of selling velvet over there, we started off in the traditional medicine market, we branched out into the healthy food market, which is just selling as a supplement or supplemented food.
"If we could get into the health functional food market, which includes human clinical studies and trials, that's an area that we've been working very closely on, and if we can get into that, that will lift the other up into another level altogether."
Griffiths said the industry needed to keep its foot on the pedal.
"We need to continually challenge ourselves," he said.
"We cannot become complacent, because doing that will erode our market share faster."
